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It's amazing that there are people that cannot accept that trade is not a zero sum proposition. If country A produces rice and country B produces meat, country
by friedman23 10y ago
It's amazing that there are people that cannot accept that trade is not a zero sum proposition.
If country A produces rice and country B produces meat, country A can trade some rice for some meat from country B. Now both country A and B can enjoy meat with rice which is better than just eating meat or just eating rice. They are both better off than when they started by engaging in trade (the sum is greater than zero).
Now add country C who only produces salt and country C trades salt to both countries A and B in exchange for meat and rice and now they can all enjoy seasoned meat with rice.
- pgwhalen 10y agoSimilarly, a ton of financial trading, especially derivatives. What people fail to realize is that these exchanges of value exist because the buyer often values something more than the seller does, not the exact same amount. In that sense, trade is creating value by allowing that difference to "realize itself," so to speak.